Accounting for businesses

Bookkeeping and accounting: what is the difference?

Bookkeeping means recording every business transaction with supporting documentation: the sale, the supplier invoice, the salary. Accounting means compiling what has been recorded. That involves reconciling, allocating income and costs to the right period and setting out the figures so that they can be read and compared. Bookkeeping tells you what has happened. Accounting tells you how things are going.

In practice the two go together. The same accounting consultant who records your documents produces the reports, and what is reconciled during the year becomes the basis for the year-end closing.

What the law requires the business to compile

Under the Swedish Bookkeeping Act (bokföringslagen), the ongoing bookkeeping must be closed for each financial year, either with an annual report or with annual accounts.

• Annual report. Limited companies (aktiebolag, AB), economic associations (ekonomiska föreningar) and trading partnerships (handelsbolag) where a legal entity is a partner must close with an annual report. Under the Annual Accounts Act (årsredovisningslagen), it consists of a balance sheet, an income statement, notes and a directors' report. Read more about the annual report.
• Annual accounts. Other businesses, for example most sole traders (enskild firma), normally close with annual accounts consisting of an income statement and a balance sheet. If annual net turnover is normally no more than SEK 3 million, the annual accounts may be prepared in a simplified form. Read more about year-end closing.

When the bookkeeping is closed, the entries needed to determine the year's income and costs and the financial position on the balance sheet date must be recorded. These year-end entries are what make the year's figures correct, and the work goes considerably faster when the accounts have been reconciled during the year.

The reports you receive and how to use them

We produce the reports during the year for your benefit. They let you see how things are going while there is still time to act, rather than only once the year-end accounts are finished.

• Profit and loss report. Income minus costs for the period and for the year to date, set out as an income statement. Use it to see whether your margin is holding, which costs are growing and whether the year is heading for a profit or a loss.
• Balance sheet report. What the business owns and owes at the end of the period: cash and bank, trade receivables, trade payables, tax liabilities and equity. Use it to see how much money is tied up in unpaid customer invoices and what needs to be paid out over the coming months.
• Budget and cash flow forecast. How your cash is expected to develop going forward, based on known payments in and out, VAT and taxes. Use it before larger purchases, hiring staff or withdrawals, so that you know the money will be enough even when VAT and tax are due. We produce it as a separate engagement, see business plan and budget.
• Monthly report with key figures. Profit and loss, balance sheet and key figures gathered in one report every month, so that you can follow developments over time. Included in Premium.

How your accounting consultant works

1. Ongoing bookkeeping and reconciliation. Your documents are recorded in Fortnox and the bookkeeping is reconciled against the bank and the tax account, see bookkeeping.
2. Period closing. We check that income and costs have ended up in the right period and that the VAT and tax accounts are correct.
3. Reports. You receive a profit and loss report and a balance sheet report, and in Premium a monthly report with key figures.
4. Review. You take any questions about the figures to your consultant. Advice is included at 2 hours per month in Basic, 4 hours in Complete and is unlimited in Premium.
5. Year-end closing and annual report. At the end of the year, the reconciled accounts become the year-end accounts, the annual report and the income tax return. This is included in Complete and Premium.

Accounting firm in Gothenburg

Ekonomico is an accounting firm with an office at Nya Tingstadsgatan 1 in Gothenburg. You have your own accounting consultant who knows your business, and we work in Fortnox. When something looks odd in a report, you ask your consultant, not a switchboard. We do not carry out audits. If the company is required to have an audit or you would like an auditor, we work with one.

If you want to go beyond the reports, with budgets, financing or bigger decisions, read more about financial advice. Questions about salary and dividends belong under tax advice.

What does accounting cost?

Accounting is included in the packages. Basic from SEK 1 500/month covers ongoing bookkeeping, payroll for up to 3 employees, VAT returns and employer declarations, and advice for 2 hours per month. Complete from SEK 2 300/month adds year-end closing, the annual report, the income tax return, the K10 form, payroll for up to 6 employees and advice for 4 hours per month. Premium from SEK 3 900/month adds payroll for up to 10 employees, unlimited advice, a monthly report with key figures and tax planning of salary and dividends. All prices exclude VAT.

Fixed monthly price based on the number of vouchers and employees, no lock-in period, three months' notice. See prices.